Planning and Business Executive Team Business Game Report

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Planning and Business Executive Team Business Game Report

        “Executive Team” is a business game in which we have been involved over six weeks; the business game consisted of 4 teams who formed 4 companies to compete in 5 separate trading areas. The game is an interactive game in which the decisions of 1 company have an impact on the other teams positioning as well as their own. Each team has a home trading area, these are areas 1 to 4 and there is a common area, area 5. All of the companies are free to trade in all of the areas. The advantage of trade in the home area is that transport prices are lower. We participated in the game for 6 weeks and had 7 periods in which we made decisions.

        The team in which I played was company 4 at the start of the game our objectives were as follows:

  • To get out of loss and into profit
  • To try and bring down the cost per unit and create a more efficient production line, which in turn would boost profits
  • To aim to have optimum stock sales therefore creating efficiency and reducing storage costs.

In this report I am going to asses the decisions made and the implications of those decisions in the areas of pricing policy, marketing and product policy, production policy and transport and distribution policy, I am going to assess the decisions and their impact period by period.

We had a simple approach to pricing policy we decided that we would use our price along with marketing to maximise our sales we used the first week to decide which areas we felt we wanted to up sales in and to decide which areas where we thought sales were at an acceptable level. To aid me in assessing the pricing policy I made a graph (see appendix 2).

At period 0 price, marketing and sales were all on at an even level so our first decision we decided to keep areas 1, 2 and 3 at the same levels, with area 4 being the home area we reduced the price to keep our consumer in this area happy and in area 5, the common area, we upped the price to 62, this being the common area we decided raising the price would see whether the common market was prepared to pay more for our product. The effect of our changes in period 1 where that sales in area 2 rose whereas in areas 1 and 5 sales dropped and in area 3 and 4 sales remained the same. In period 0 we had produced 817 however had only sold 775 and due to opening stock we closed with 232 units in stock, this was going to cost us in storage, if we could accurately predict a sales number we would save this unnecessary cost so we decided to produce 600 units which in turn gave us 832 units in total to sell and with any luck we wouldn’t be left with as many in storage. As for transport and distribution policy we decided that as we were in loss we shouldn’t yet invest in vehicles so we hired vehicles as this would save us maintenance costs. Our decisions for period 1 resulted in a dip in cumulative retained earnings (see appendix 6) whilst retained earnings rose (see appendix 5), we had made considerable profit however we were still in loss.

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From the results of periods 0 and 1 we then were slightly more informed of our markets so in period 2 we dropped the prices in area 1 and 3 whilst area 2 remained at 60, area 4 we pulled back up to 60 and area 5 we reduced to 61. Area 1 we dropped price in hope it would boost sales as this was the area where we lost most sales and so we wanted to entice a clientele and thought dropping the price would do this. We also dropped price in area 3, in this area we had ...

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